Commentary –

Milk – Connecticut’s Metaphor For Free Trade

By William A. Collins

Cheaper milk,

Is nice for me;

But for farmers,

Bankruptcy.

The whole world loves a good metaphor, and Connecticut’s got one. Milk. We grow it here, mostly in cows, and our farmers have to sell it for peanuts to the milk cartel. These folks in turn package it for us in those familiar impenetrable cardboard containers.

The metaphor part involves the price that the cartel pays the farmer. It’s now a lot like free trade. Up until September 30, there was a protective federal law. It required New England processors to pay at least $16.94 per hundred pounds of milk they bought from New England producers. When the free market price fell below that level, the floor became a subsidy to local farmers, much like a minimum wage. Now, without that floor, still more dairymen in high-cost New England will go out of business and sell their farms.

That result will be widely hailed in Wisconsin, where land and feed prices are low. Producers there will cheerfully pack up their milk in tank cars and ship it off to us. Connecticut will be less happy. We cherish the open space that our farms lend to the landscape. They are our best defense against sprawl. We also cherish fresh milk.

So when terrorism finally dies down, will Congress go ahead and reauthorize the law? Let’s hope. In the meantime it’s instructive to watch New England’s 12 senators line up to support this beneficial but clear restraint of trade. Many otherwise extol the sanctity of free trade, as long as it’s someone else’s cow that’s getting gored.

Take Mexico, where corn is like our milk. As part of NAFTA, Mexico had to give up restricting its importation. For city folk, that was dandy, at first. Trainloads of cheap Midwestern corn soon began rumbling across the border, and the price of tortillas in Guadalahara quickly dropped a couple of centavos.

That was the good part. The bad part followed soon enough. Millions of marginal farmers couldn’t compete anymore, and many stopped trying. Hundreds of thousands started crowding into Guadalahara, Mexico City, and Monterey looking for work. Not to mention flooding the US border, seeking employment, any employment, over here. The social fabric of many rural parts of Mexico is deteriorating accordingly.

Free trade here in milk won’t bring quite such harsh results. We haven’t that many farmers for one thing, and most have other skills. At worst they can drive school buses, which is probably about as much as they make from farming anyway. The problem is the farms themselves. Unlike Mexico, they’re worth a lot of money. For broke, disgusted farmers, the temptation to sell out to developers is nearly irresistible. Then the open space is gone for good.

Given this alternative, most Nutmeggers would gladly pay a few more pennies for a half gallon of milk. But most of milk’s price is set by the cartel anyway, and the benefits of a lower commodity price would probably just go to them. New England’s six attorneys general are already after them for price-fixing.

But Mexico lacks such a subsidy option. Residents of Guadalahara would probably be ready to pay a few extra centavos for their tortillas too, but NAFTA and World Trade Organization (WTO) won’t allow that. Imports from the US may not be impeded in any way.

The same goes for bananas in Europe. Former colonial powers wanted to protect their old Caribbean colonies by favoring them in the importation of bananas. But the US protested. We have big investors in Honduran plantations. Thus the WTO ordered Europe to drop its preferences, leaving thousands of small banana farmers on the islands unemployed. Dairy farmers there now suffer too, since islanders are not allowed to keep out cheap powdered milk imports either. Connecticut dairy farmers, being a metaphor for free trade, would recognize these sufferings in an instant. Luckily NAFTA doesn’t cover them. Just Congress.

(Columnist William A. Collins is a former state representative and a former mayor of Norwalk.)